GBP/EUR Rate May Rebound to €1.18 as BoE Rate Hopes Rise

The Pound-Euro exchange rate is poised to retest its recent highs if UK inflation strengthens Bank of England (BoE) rate expectations. The current rate is trading at €1.1701, up around 0.2% on the week.

Last week, the GBP/EUR exchange rate rose to a 19-day high but trimmed its gains towards the end of trade. The Pound opened the week with gains despite no obvious catalyst behind the move, but lacked direction for the rest of the week.

The Euro weakened against the rising Pound on Monday as the currency's inverse trading relationship with the rising US Dollar pressured EUR. However, EUR regained some ground on Thursday thanks to better-than-expected Eurozone industrial production figures.